Johnson & Johnson beats the analysts’ estimate for EPS in Q4 as revenue prints marginally shy of the forecast

Johnson & Johnson beats the analysts’ estimate for EPS in Q4 as revenue prints marginally shy of the forecast
Written by:
Michael Harris
23rd January, 09:33
Updated: 11th March, 09:06
  • Johnson & Johnson beats the analysts' estimate for earnings per share in the fourth quarter.
  • At $20.74 billion, quarterly revenue was marginally lower than the experts' forecast of $20.8 billion.
  • J&J faced multiple lawsuits in the recent years with litigation costs declining to $264 million in Q4.
  • J&J's major drugs posted a significant increase in terms of sales in the fourth quarter.

American multinational corporation, Johnson & Johnson, announced its performance results for the fourth quarter on Wednesday. The Q4 earnings report highlighted the company to have beaten the analysts’ estimate for earnings per share while revenue was noted marginally shy of the forecast.

According to Refinitiv, analysts had anticipated $20.8 billion in revenue for Johnson & Johnson in the fourth quarter. Estimate for earning per share (EPS), on the other hand, was capped at $1.87. On Wednesday, the American multinational highlighted that it missed the forecast for revenue printing $20.74 billion in revenue while the EPS was just above the estimate at $1.88.

Revenue From J&J’s Multiple Business Units In The Fourth Quarter

The pharmaceutical business of J&J climbed 3.5% in terms of revenue as compared to the same quarter last year and was recorded at $10.54 billion. The consumer unit that is known for products like Neutrogena posted $3.5 billion in revenue that marked a 0.9% increase (year over year). Lastly, the medical device unit generated $6.63 billion for J&J in the fourth quarter that was shy of the last year’s figure by 0.5%.

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As per the sources, recent years weren’t too kind to Johnson and Johnson as the company faced multiple lawsuits with one alleging the brand for its role in the nationwide opioid epidemic while another claiming its baby powder (talc-based) to be a cause of cancer. In the fourth quarter, however, the company announced its litigation costs to have seen a sharp decline to $264 million. In the same quarter last year, such costs amounted to around $1.29 billion.

Despite the additional costs associated with legal procedures, J&J has managed to climb over 2% in 2020 so far that is almost in line with the benchmark S&P 500 that has increased 3% in January.

J&J’s Sales Figures For Multiple Drugs In The Fourth Quarter

J&J’s Remicade drug that is widely used for rheumatoid arthritis posted a 5.4% increase in Q4 sales to $3.5 billion. Darzalex for myeloma recorded an even bigger 9.1% hike in sales to $2.7 billion. While J&J’s Stelara sales climbed 6.6% in the fourth quarter to $515 million, the largest surge was seen in Imbruvica (cancer drug) that registered $830 million in sales that marked a massive 42.1% increase.

For fiscal 2020, the company now expects $8.95 to $9.10 of earnings per share while the estimate for revenue lies between $85.4 to $86.2 billion. Regardless of the litigation expenses, the $390.18 billion company gained a little over 15% in the stock market in 2019. Earlier this week, share prices were seen at $150 that marked a record high for the company.

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